The Influence of Financial Performance on the Level of Investment Returns in Sharia Mutual Funds

This study aims to analyze the influence of financial performance on the level of investment returns in Sharia mutual funds. As the demand for Sharia-compliant financial products continues to grow, understanding the key factors that affect fund performance becomes increasingly important for investors, fund managers, and academics. The research adopts a quantitative approach using multiple linear regression analysis to examine the relationship between financial performance indicators namely Net Asset Value (NAV), Return on Assets (ROA), Return on Equity (ROE), Expense Ratio, and Fund Size and investment returns. The study analyzes secondary data from selected Sharia mutual funds registered with the Financial Services Authority (OJK) in Indonesia over a five-year period from 2019 to 2023. The results indicate that NAV and ROA have a positive and statistically significant influence on investment returns, while Expense Ratio has a negative and significant impact. ROE and Fund Size, however, do not show a significant effect on returns. These findings suggest that efficient asset utilization, asset growth, and cost management are critical to maximizing investor returns in Sharia mutual funds. The study contributes to the literature on Islamic finance by providing empirical evidence on fund performance determinants and offers practical insights for investors and fund managers seeking to optimize Sharia-compliant investment strategies.